income from capital investment
Final withholding tax (Abgeltungsteuer)
Income derived from the investment of private capital assets
qualifes as income from capital investment. This includes in
– Current earnings such as interest and dividends, income from
interests in investment funds, etc.
– Gains on the disposal of private capital assets
When determining income from capital, an amount of € 801
(€ 1,602 for married couples and civil partners fling jointly) is
to be deducted as an overall allowance for costs of earning
non-business income (Sparer-Pauschbetrag). Deducting the
actual costs of earning non-business income is not permitted.
Tax liability is discharged with the final withholding tax of 25%
(plus solidarity surcharge and – if applicable – church tax) being
withheld by the domestic paying agent (bank, the client’s
custodian, etc.). No tax will be withheld if the taxpayer is able
to furnish a certifcate of non-assessment and/or a certifcate of
exemption. Assessments are possible in exceptional cases only.
As there are a multitude of capital investment products on offer,
the form of applicable taxation depends on the individual case.